Huang Guangyu trial and real estate dilemma

Sinica Podcast

Kaiser Kuo

Currentaffairs, Business, News, China Politics, Shenzhen, Chinese, Chongqing, China News, Politics, China, Culture, Sichuan, Hangzhou, Beijing, International Relations, China Economy, Chengdu, Film, Shanghai, Guangzhou

4.7 • 710 Ratings

🗓️ 1 May 2010

⏱️ 48 minutes

🔗️ Recording | iTunes | RSS

🧾️ Download transcript

Summary

Huang Guangyu, the founder of home electronics chain GOME, was China’s richest man, with a fortune of over 6 billion dollars in 2006, according to Forbes. However, the multi-billionaire was detained in November 2008 on suspicion of bribery, insider trading, and money laundering. The dragnet in the investigation leading up to the trial has already widened, and has implicated a number of high-ranking cadres in the Ministry of Public Security's white-collar crimes division. Is Huang’s case a warning to the Chinese emerging wealthy class? What does Huang's trial mean for rule of law in China? Whether they own property or not, there is nothing that people across China are talking about more than real estate prices. Property prices in 70 cities in China rose by a whopping 11.7% just in March 2010. Records show that new real estate loans grew to over 1.4 trillion dollars in 2009. People all over China talk about the phenomenon of “house slave” — people who are enslaved to their mortgage, and working only to pay off their homes. What dilemma does China face over the soaring property prices? In the mean time, Beijing issues sharp new policies to curb speculation. Do the government's actions portend the collapse of the real estate bubble? Joining host Kaiser Kuo this week are Gady Epstein, Beijing bureau chief for Forbes magazine, and Sinica regulars Bill Bishop and Will Moss. Bill is a tech entrepreneur in Beijing who blogs regularly on politics and economic issues at Sinocism.com. Will is a public relations expert in China and the force behind the popular imagethief.com. References: The Curse of Forbes, by Gady Epstein Rule of Law Implications of Huang Guangyu Trial?, by Stan Abrams How China's Property Bubble Works, by Andy Xie See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Transcript

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0:00.0	Welcome to the Cynica podcast, a weekly discussion of current affairs in China. I'm your host, Kaiser Kuo.
0:14.5	Today we'll be talking about the trial of Huang Wang Yu, one of China's richest men, and what the trial says about wealth, corruption,
0:21.7	and the rule of law in China today. Then we'll move on to the topic on everyone's lips in
0:26.2	today's China, rising real estate prices and Beijing's efforts to rein them in. With me today
0:32.1	at the pop-up Chinese studio in Beijing, our regulars Bill Bishop has been writing quite a bit about
0:36.5	real estate at his blog, sinicism.com. How are you? Bill. Great. Thanks, guys. Also joining us is Will Moss,
0:42.6	the man behind the blog, Image Thief.com. Hi, Kaiser. And we're also joined today again
0:47.0	this week by Gotti Epstein, Bureau Chief for Forbes magazine. Gentlemen, welcome to all of you. Thank you. Let's hop right in here.
0:57.2	Huang Guang Yu, in the curse of the Chinese rich.
1:00.5	The trial of Huang, who by some counts, is Chinese, man, began here in Beijing last Thursday, the 22nd of April.
1:04.5	The multi-billionaire was detained in November 2008 on suspicion of bribery, insider trading,
1:09.9	and a host of other white-collar crimes.
1:11.8	Gotti, let's start with you. Who is Huang Guang Yu? Superficially, at least, he sounds like a
1:16.2	Horatio Alger story, doesn't he? That's right. He was born a poor family near Santo in Guangdong.
1:23.2	He was a school dropout, one of four kids. He and his brother started selling miscellaneous electronics at a very early age and eventually
1:33.6	built that into Goumet, the electronics retail giant.
1:37.3	He became China's richest man, according to Forbes, in 2006 with a fortune over $6 billion.
1:43.5	And what does he actually alleged to have done, Bill?
1:46.9	Are you familiar with what his actual litany of crimes or alleged crimes?
1:50.2	I think what he's been charged with is insider trading bribery as well as what looks to be a money laundering charge under the guise of a legally operating business.
2:01.9	Yeah, he can be sentenced up to 20 years for the three charges.
2:05.2	Right. Apparently he had, what, swapped something like 800 million Hong Kong dollars with
	...

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